Dairy Farmers Shoulder Too Much Of Load

On Thursday, June 20th, the U.S. House of Representatives voted on the House version of the 2013 Farm Bill, HR-1947. It received a solid trouncing, going down in defeat, 195 to 234. Obviously, the House leadership is challenged with a House majority that defies being led, compounded by an inherent inability to build consensus. Perhaps a dose of cluelessness, too: both Speaker John Boehner, R-Ohio, and Ranking Member of the House Ag. Committee, Collin Peterson, D-Minnesota, were convinced they had the necessary votes for passage of HR-1947 until the vote was actually underway. Both were blindsided by botched vote estimates, then stunned and dismayed watching the best chance for a much anticipated 2013 Farm Bill go down the pipe.

The big question is now whether they will tweak HR-1947, try to rally support, (if that is even possible) and run it through again, or just re-up the currently extended 2008 Farm Bill when it expires on Sept. 30th. Currently, all concerned are licking wounds and crafting poisonous rhetoric to hurtle at each other. Sadly, in the U.S. House, this is now what passes as business as usual, after a major legislative failure.

Before the debate on HR-1947 began, Peterson prophesied the 2013 Farm Bill would likely be the last of its kind; given current realities, the 2008 Bill will probably be elevated to that dubious distinction. It appears the urban-rural, bi-partisan coalition that scratched each others’ backs to mutual benefit on food stamp and farm policy issues for several decades has come unravelled. That the case, for better or worse, consensus on comprehensive national farm legislation may now be out of reach in the U.S. House-simply a thing of the past…

Small, family farm dairymen should lose little sleep over all this, since HR-1947’s dairy provision, The Dairy Security Act, was flawed, weighted heavily in favor of large factory style dairy operations and inappropriate. The nation’s dairymen need a stable, fairly calculated price for their milk, not a Federally subsidized dairy margin insurance boondoggle that, at best, will merely cover losses.

No matter what dairy margin insurance schemes are served-up by the National Milk Producers Federation, the lobby serving the executives of the nation’s large dairy co-operatives, and foisted off as solutions on Congress, none are of any real value for dairy farmers. The Dairy Security Act didn’t address and reform the underlying root of the problem; the flawed USDA Milk Price Formula. The current USDA Milk Price Formula relies on data collected on cheese transactions conducted on the floor of the Chicago Mercantile Exchange. There, less than 1 percent of U.S. milk production, prices the remaining more than 99 percent in a process that is routinely manipulated to advantage by major milk buyers.

While U.S. milk processors should have some say in what they pay for milk, they should not have total say. Since the beginning days of the Reagan Administration, U.S. dairy farmers have been systematically short changed on the value of the milk their cows produce. Before Reagan, when a consumer spent a dollar on dairy products, 53 cents of that dollar went to the farmer who supplied the milk; currently the farmer receives about 25 cents of that same dairy food dollar, albeit proportionately, it does not cost any more to process or retail dairy products.

If U.S. dairy farmers had a fair, transparent Federal Milk Price Formula, using information direct from the marketplace, indexed for current cost of production and reflecting prices paid by consumers, it would be better for all concerned. The proper role of the Federal Government could then be as a referee, strictly enforcing carefully crafted rules designed to maintain a level playing field for price discovery for both farmers and processors.

The nutritional value of dairy products to the diet of this nation’s poorest citizens is essential and inestimable. It is grossly unfair that U.S. dairy farm families are expected to labor at below minimum wage, for often no wage at all, just to keep dairy product prices low in U.S. supermarkets. Nor should taxpayer money have to subsidize the consumption of U.S. dairy products. American consumers pay enough for dairy products. The money is in the marketplace; it simply needs to be redistributed to fairly reflect the monumental contribution of U.S. dairy farmers to the nation’s nutritional well being.

Supplying economically priced dairy products to this nation’s poor should call for equal effort from all, not just be arbitrarily and unfairly placed on the backs of the nation’s dairy farmers, while dairy processors and grocery retailers hold hands and giggle all the way to the bank …

Nate Wilson, a Sinclairville resident, has retired from 40 years of dairy farming on a small hill farm in Chautauqua County. He is a regular contributor to The Milkweed, a national dairy industry monthly.